2.1 Unit Overview .
To master this unit you are expected to discuss about:
1) Definition and interpretation of strategies and strategic objectives.
2) Types and characteristics of different strategies and how they are applied in specific environments.
You will also be able to differentiate between values , focus areas with regards to strategic planning
2.2 Introduction.
In Unit 2 you will study :
• How to differentiate between different types of strategies
• How strategic objectives are conceived and developed .
• You will learn about strategic vision and values .
2.3 Unit Objectives and Intended Learning Outcomes. After you have studied Unit 2 , you are expected to :
• Be able to compare and contrast different types of strategies
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Other authors have defines strategy from various perspectives. For Henri Mintzberg strategy is "a pattern in a stream of decisions". which is contrasted with that of Max McKeown (2011) for whom "strategy is about shaping the future" and is the human attempt to get to "desirable ends with available means". Vladimir Kvint (2009) provides is more systematic in his approach. He defines strategy as "a system of finding, formulating, and developing a doctrine that will ensure long-term success if followed faithfully." Courtesy BDS Glasgow, 2014: Strategic Thinking
Strategy is translated into concrete action ( strategic implementation) through a well designed strategic plan. A strategic plan starts with a clearly defined business mission. For Mintzberg, a mission is defined as follows:
“A mission describes the organisation’s basic function in society, in terms of the products and services it produces for its customers”.
Elaborating further Richard P. Rumelt ( 2011) describes strategy as a kernel with three components appropriate for addressing a challenge or systematically solve specific problems. The three parts of the kernel
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(2011). Good Strategy/Bad Strategy. Crown Business. ISBN 978-0-307-88623-1.
2.2. Business Strategy definitions and interpretations
In general terms business strategy is the direction and scope of an enterprise extended over the long term. It evolves within challenging environments namely internal and external expansion. The aim is to achieve growth and competitive advantage through judicious use and optimization of its strategic human and material resources. Johnson and Scholes (2010), in their book, Exploring Corporate Strategy define strategy thus:
"Strategy is the direction and scope of an organisation over the long-term: which achieves advantage for the organisation through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfill stakeholder expectations" (Johnson and Scholes, 2010)
Therefore business strategy is about the company’s direction, scope, market positioning, competitive advantage, human and material resources, internal and external environments, and stakeholders who directly or indirectly influence the business development.
Meeting the needs and exigencies of markets and fulfilling stakeholders expectations remain the focus of strategies at different levels within an
a. Basically, corporation strategy demonstrates a corporation’s overall direction in the light of its general mindset toward growth and the management of its businesses and product portfolios. There are three crucial categories, which are stability, growth, and retrenchment, that involve within corporation strategy. Additionally, business strategy often occurs at the business unit or product level, and it highlights the improvement of the competitive position of a company’s products and service in the particular market segment served by the business unit. Competitive and cooperative strategies are two main categories that match within business strategy. Furthermore, functional strategy is the method that through a functional area to
23), a strategy is competing differently using a set of actions to perform better over rivals and achieve greater profitability. It is about choosing to be different and making the correct choices to provide direction and guidance to employees and the company on what to do and what not to do.
Wit, BD & Meyer, R 2010, Strategy: process, content, context : an international perspective, Cengage Learning EMEA, London.
Business strategy is the means by which firm’s plans to achieve its goals and objectives. It can also be termed as organization long-term planning. The strategy covers periods between 3-5 years and sometimes longer. Businesses use two major types of strategy, general or generic and competitive strategies. The overall strategy involves strategies of growth, globalization and retrenchment. The competitive advantage includes low pricing, product and customer differentiation. We will look at the business strategy used by Marks and Spenser (Cole, 1997). The company is a British multinational located at Westminster London and specializes in clothes and luxurious food products.
There are different types of strategies for businesses such as the corporate strategy, functional strategy, and business (competitive) strategy. The corporate strategy is used to determine what business a company will own and operate (“Managing the
To formulate a strategy, one must understand what a corporate strategy is. According to Hitt, Ireland, & Hoskisson (2013, p.164) “a corporate strategy is a specific action a firm takes to gain a competitive advantage. Corporate level strategies help companies to select new strategy positions”.
In the book, “Good Strategy/Bad Strategy the Difference and Why it Matters,” by Richard P. Rumelt describes the difference between the two strategies by providing different examples. The book is divided in three different parts the first part consists of “Good and Bad Strategy,” followed by the “sources of power,” and the last part consists of “Thinking like a Strategist.” In the introduction chapter Rumelt describes how good strategy looks simple and obvious not requiring much to explain. He furthermore says that such strategies do not come from some tool or chart it is however identified by a talented leader who highlights one or two critical situations. The author says the most important responsibility of a leader is to identify the biggest challenges in order to progress further and find ways to overcoming those challenges. The book is driven by lifetime experience as consultant of organizations, personal adviser, teacher and a researcher. Good strategy is concentrates on solving the problem. However, bad strategies skip problems and focus on multiple conflict demands and interest.
It tells a layman business person or a person interested in setting up a business soon that a strategy is about planning for the future. It is to plan the future in a way that makes it easy for the managers to set up objectives and for the employees to follow those objectives (McKeown, 2012). The book gives examples of successful business persons and how they made their business strategy when they came into the business field. There are examples of people, who found success instantly, and there are also examples of business persons who struggled at first, but then after reshaping the strategy they were able to effectively conduct their business. It is very helpful for new entrepreneurs to know about these strategies so that they could also learn and implement it in their
Numerous definitions of strategy exist, in most circumstances strategy can loosely be explained as an overall plan of deployment of resources to ascertain a favourable position within a market (Zablah, Bellenger and Johnston 2004; Grant 1994, p 14). Further, imbedded in many successful organisations are strategies, the importance of which is to remain relevant in the market, and successful in the various attributes of business; profiteering, employee motivation, maintaining sustainable core competencies, effectiveness in operation, or efficiency in the conduction of operations. Therefore challenges involved in the formulation and implementation of a strategy can revolve around the overall external market, as well as internal
De Wit, B., & Meyer, R. (2010). Strategy: Process, Content, Context, An International Perspective. Cengage Learning.
The first portion of the novel is centered on understanding the essence of strategy. The understanding strategy, according to the author, is derived from truly comprehending what strategy
A business level strategy is an integrated and coordinated set of commitments and actions the firm uses to gain a competitive advantage by exploiting core competencies in specific product markets.
A successful business strategy will identify changes in the external trends in the market place. Plan out what the company’s future direction is. Set out the goals for the management team. It will identify a vision of where the company wants to be in the future. Keep all employees informed of the direction of the company.
Strategic implementation is a critical factor when making decisions regarding issues that affect the vision, mission, or objectives of an organization. Strategies are often implemented in accordance to the culture of the organization, the nature of control systems, the stakeholders, and the nature of the organizational design. In order to achieve success in the implementation of strategies, the structure of these factors must work in coordination with one another. For instance, the strategic vision of CPK lies in the creation of a globally recognized brand name and therefore, all of the goals and objectives of CPK must be directed in realizing that the company achieves this objective (California Pizza Kitchen 2011). Furthermore, the vision statement is inclusive in itself in that it communicates the message in a directional, flexible, and focused manner.
Strategy is nothing but a plan to bring up with new and innovative ideas for the future development. Strategy has become an often word that applies to many circumstances and area of business. There are many strategies like sales, innovations, marketing, HR, etc. strategy will change the shape of the company objectives and it will help to reach our goals and aims perfectively. Every organization must need a strategy plan, without strategy plan they will not get any success. Strategic planning is very important to every organization, because through strategic plan we can reduce the cost of the product, increase efficiency and save the time of the project.